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Amazon Vendor Manual gives Amazon permission to use vendor trademarks for keyword advertising of competitor products, says federal court

RTDC — Read the damned contract: That’s a big cautionary lesson for vendors selling their products on Amazon or other hosts. Here’s a case in point that I just read about (hat tip: Susan Rector). ¶ Video Professor, Inc. (VPI) sold its products on Amazon. The relevant agreement was the Amazon Vendor Manual. That manual said that Amazon had a “worldwide, perpetual, and royalty-free license” to use the relevant VPI trademarks. ¶ As a result, a federal court held, Amazon had the right to use VPI’s trademarks in doing Google keyword advertising for products of VPI’s competitors — even after VPI stopped selling its products on Amazon and terminated the agreement. See Video Professor, Inc. v. Amazon.com, Inc., No. 09-cv-00636, 2010 WL 1644630 (D.Colo. April 21, 2010) (granting Amazon’s motion for summary judgment dismissing VPI’s trademark-infringement claim).

Amazon also filed a motion to force VPI to reimburse Amazon for its attorneys’ fees. VPI for its part filed filed a notice of appeal. The parties subsequently settled the case, and both the appeal and the motion for attorneys’ fees were dismissed.

And the agreement might not have mattered anyway: If the current judicial trend holds, Amazon might well have had the right to use VPI’s trademarks for keyword advertising in any case. See this blog entry by Eric Osterberg.

Comments on this entry are closed.

  • Chris Lemens 2011-01-17, 10:55

    I wonder what happens if you combine this case with the cases saying that a trademark license lacking a right for the licensor to police the use of the trademark causes the trademark to terminate.

    Chris Lemens

  • D. C. Toedt 2011-01-17, 11:22

    @Chris, the trend seems to be that a trademark owner’s competitors can use the mark in keyword advertising (see the last paragraph of the post). That seems to imply that the Amazon license terms are not a naked license that would destroy VPI’s rights in its trademarks.

    Thanks for stopping by.